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Accounts is one most sought after subjects in the entire world. This is one reason why people can always expect many students taking up this course. This subject is quite vast, and budget is quite difficult to understand in this.

With budget students often loses their way to success. The chapter is extremely broad with information on different types of budgets. One very interesting and confusing budget is the static budget no doubt.

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What is static budget?

Budget is a finance plan made by every firm. It helps them determine the amount that they will spend. Static budget is, of course, one unique concept. It states that under no condition must the budget be different.

This can definitely work for some companies while will absolutely not work for some. With great static budgets and variances homework help people can understand more about this.

Companies that it will work for:

Few firms are no doubt quite stable. They have the following scenarios, and thus static budgets work for them:

  • Predictable Sales:

This is no doubt the foremost scenario that people must know of. Many firms have predictable sales. Maybe it is a nature of their business. Or it can even be a boon to an excellent sales and management team. These firms can always have a stable budget.

  • Predictable expenses:

Similarly these firms or other firms have a predictable expense set. They understand that expenses can be controlled and how! This is absolutely where these static budgets are applicable as well.

One must have the best static budgets and variances assignment help to understand more.

Companies it will not work for:

There are companies where operating and production costs change unexpectedly. In these scenarios using a stable budget is not a smart option of course.

The types of stable budgets:

There are two types of stable budgets. These usually depend on the budget variances. Hardly there are scenarios where a predicted budget matches to the actual cost. Always some or the other variance exist.

Depending on this particular scenario, there are of course two types of static budgets:

  • Favourable:

When the actual cost is less than the predicted budget. Of course, then it is a positive variance. And thus it is a favourable budget.

  • Unfavourable:

At times, the predicted budget is less than the actual cost. This cannot be a good scenario. It ultimately gives birth to the unfavourable budgets of course.

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